Hot Topics:

US stocks manage meager gains on mostly quiet day

Alex Veiga AP Business Writer

Posted:
06/16/2014 08:25:01 AM MDT

Updated:
06/16/2014 03:25:17 PM MDT

Click photo to enlarge

FILE - In this March 8, 2010, file photograph, a sign for Wall Street is shown near the New York Stock Exchange. World stock markets mostly declined Monday, June 16, 2014, as the turmoil in Iraq dampened sentiment and investors held back ahead of the Federal Reserve's monthly policy meeting later in the week. (AP Photo/Mark Lennihan, File)

Investors nudged U.S. stocks into positive territory Monday, thanks in part to another round of corporate couplings.

Three proposed acquisitions, including medical device maker Medtronic's $42.9 billion bid for rival Covidien, helped the market eke out a slight gain for the second trading day in a row.

Homebuilding stocks also got a boost from a survey showing that U.S. homebuilders' outlook on the housing market improved this month.

Stocks mostly hovered between small gains and losses through much of the day as traders monitored the conflict in Iraq and considered its potential impact on oil prices.

Major U.S. stock indexes were down in premarket trading, but began to rebound within the first hour as investors bid up shares in Ireland-based Covidien. The stock jumped $14.73, or more than 20 percent, to $86.75. Medtronic shed 67 cents, or 1.1 percent, to $60.03.

"Merger Monday clearly gave a lift to the market," said Joe Peta, managing director at Novus.

Two other deals also drew heightened interest from traders.

Williams Cos. hit an all-time high after the pipeline operator agreed to buy a part of natural gas processor Access Midstream Partners for nearly $6 billion. Williams vaulted $8.84, or 18.7 percent, to $56.02.

Advertisement

TW Telecom climbed $2.65, or 7.3 percent, to $38.99 after the Internet provider agreed to be acquired by Level 3 Communications for about $7.3 billion, including debt. Level 3 shares fell $1.79, or 4.1 percent, to $42.30.

The market was still heading for a loss in the final hour of trading, then recovered within the last 10 minutes.

All told, the Standard & Poor's 500 index rose 1.62 points, or 0.1 percent, to 1,937.78. The index is down less than 1 percent from its most recent all-time high of 1,951.27 set a week ago.

Bond prices were flat. The yield on the 10-year Treasury note held steady at 2.60 percent.

The market has been sluggish in recent months, even as investors have had more than a few geopolitical concerns to worry about. Earlier this year, it was currency concerns in Turkey and then the fallout from Russian-Ukraine tensions. Last week, the insurgency in Iraq erupted, causing a spike in oil prices.

Still, the day-to-day market swings have been mostly minor.

Monday was the 41st day in a row that the S&P 500 did not move 1 percent, one way or the other, Peta noted.

"That lack of volatility is something we have not seen since 1995," he said. "You can call it complacent, or non-volatile or sluggish, but certainly this is a different environment than we've seen for quite some time."

At the same time, a flurry of merger news has helped lift stocks in recent weeks, a trend that underscores that stocks are not seen as expensive right now.

The National Association of Home Builders/Wells Fargo builder sentiment index rose this month to the highest level since January. The latest report suggests homebuilders' confidence in the housing market is improving. Homebuilder stocks rose, led by LGI Homes, which added 60 cents, or 3.4 percent, to $18.24.

Investors will be looking ahead this week to what the Federal Reserve will say on Wednesday, when it wraps up its latest two-day meeting of its policymaking committee.

"Where we'll see risk injected (into the market) will be if there's anything but a rubber stamp of the Fed waiting until next year to raise rates," he said.

Lockheed says object part of 'sensor technology' testing that ended ThursdayWhat the heck is that thing? It's fair to assume that question was on the minds of many people who traveled along Colo. 128 south of Boulder this week if they happened to catch a glimpse of what appeared to be a large, silver projectile perched alongside the highway and pointed north toward town.

PARIS (AP) — Bye, New York! Ciao, Milan! Bonjour, Paris! The world's largest traveling circus of fashion editors, models, buyers and journalists has descended on the French capital, clutching their metro maps and city guides, to cap the ready-to-wear fashion season. Full Story